Oracle's growth is far from over. So why is the market reacting so negatively to a 1-cent earnings miss?

If you consider that Oracle's normal PE ratio over the past decade has been approximately 20, then logic would dictate that Oracle's share price should have dropped by 20 cents, or 20 times 1 cent. Instead, Oracle's stock price fell by $3.47, or 9.69%, Thursday. How is it logical that the market value of a $169 billion technology stalwart could fall by that much in a matter of minutes?

When I was a boy I used to love reading superhero comic books, and Superman was one of my favorites. In the 1950s DC Comics introduced Bizarro Superman from Bizarro World. Bizarro Superman was the exact opposite of Superman, and in the alternate world he lived in everything was the exact opposite of normal. Today, more than five decades later, I often wonder if Wall Street is the true life version of Bizarro World.

With my feet planted firmly here on Earth, allow me to review some of Oracle's operating metrics for the third quarter, which, by the way, is typically one of the company's weaker quarters. There certainly were some negatives as revenue in many of its key lines were weak or even slightly down. Consequently, total revenue was flat to slightly down. On the other hand, earnings per share for the quarter grew 5% on a non-GAAP basis in US currency, and 6% GAAP earnings per share growth in US dollars.

Operating cash flow increased to $13.7 billion and free cash flow grew to $13 billion, both third-quarter records. Therefore, Oracle now has $33.4 billion in cash and marketable securities. Thereby, according to President and CFO Safra Catz, "we remain committed to returning that value to our shareholders through technical innovation, acquisitions, stock repurchases, dividends, and the prudent use of debt."

Oracle has hired over 4,000 new sales associates, and during the earnings call management indicated the pipeline is full and conversion rates are up. Mark Hurd, president, announced several key wins, citing: "Travelocity, Walt Disney World, Kaiser Foundation, Office Depot, Match.com, CGI group, Southwest Airlines, Dow Chemical, Union Bank, Renault, National Instruments, and Lender Processing services. " It seems like business is pretty robust to me.